Voluntary Reductions in Wages Mount in Israel to Combat Inflation

In the face of rising prices and continuing fears of possible inflation, more and more Israelis today were volunteering to have their incomes reduced as a possible deterrent against the burgeoning inflationary cycle.

Even as more price hikes were in the offing today, with the costs of telephone service and postal rates about to double, hundreds of Israelis, individuals as well as workers’ committees in various enterprises, sent telegrams and letters to the Prime Ministers office, or telephoned to announce voluntary cuts. Israelis Joined the popular movement by offering to renounce pay increases, give up part of their cost-of-living allowances, waive retroactive wage increases and even voluntarily take reductions in pension payments.

The latest development in the trend toward a higher cost of living was the adoption by a subcommittee of the finance committee of the Knesset (Parliament) today of a proposal to increase telephone and postal rates. The full finance committee is scheduled to meet on the issue tomorrow, to approve the subcommittee’s recommendations and to set a date for the new charges to take effect.

The Government’s Central Statistical Office made public today data showing that, during 1965, salaries and wages had increased by an average of 18 percent. In some sectors of the economy, such as employment in the transport industry, wages had gone up by 21 percent. At the same time, however, the report showed, Israeli industrial production has continued to rise in the last few months, going up by well over 3 percent, while the number of work days in industry remained constant.

FARMERS URGED TO HOLD PRICE LINE ON AGRICULTURAL PRODUCTS

Prime Minister Levi Eshkol called on Israel’s farmers last night to hold the price line for agricultural products. Addressing 500 delegates to the 10th conference of the Histadrut Agricultural Center, he appealed for ‘return to the pioneering spirit and the dedication of 40 and 50 years ago.”

Conceding that the economic situation has not given reason for “a festive mood,” Mr. Eshkol said; “The time has come to stop patting ourselves on our backs and to face hard facts. Israel can no longer be dependent on others — not only because others do not want to help us any more but also because this is the way it should be.” He reiterated his call on the Israeli farmers to maintain price stability and told the agricultural delegates: “I know that some of you will ask: What about industry? Do not worry. I will get around to industry too.”

Meanwhile, however, one group of workers — those employed in the restaurant in the Knesset building — went on a warning strike today, demanding pay increases. The workers requested that the concessionaire conducting the restaurant bring their pay up to the wages paid other employes in the building. They rejected an offer by the concessionaire to bring their pay up to that paid by other restaurants in Jerusalem, insisting that those wage scales are inadequate.